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Bursa extends gains in early trade

KUALA LUMPUR, Jan 22 — Bursa Malaysia extended last week gains to trade higher in early session today, supported by continued buying interest in the selected heavyweight counters, dealer said. At 9.40am, the benchmark FTSE Bursa Malaysia KLCI (FBM…


Japan firms have no plans to strengthen governance after Ghosn arrest, Reuters poll shows

TOKYO, Jan 22 — Three-quarters of Japanese companies have no plan to create committees overseeing compensation or executive nomination, a Reuters poll found, reflecting indifference to boosting governance after the arrest of former Nissan boss…


UN sees global economy growing 3pc in 2019 but beset by risk

GENEVA, Jan 22 — The United Nations expects the global economy to grow 3.0 per cent this year and in 2020, slightly below a 3.1 per cent expansion in 2018, it said yesterday. But urgent and concrete policy action is needed to put the world on…


IMF lowers growth forecast for Saudi Arabia, region

DAVOS, Jan 21 — The International Monetary Fund today lowered its 2019 economic growth forecast for Saudi Arabia and the region over low oil prices and crude output along with rising geopolitical tensions. In its World Economic Outlook update for…


IMF fears trade war and weak Europe could trigger sharp global slowdown

DAVOS, Jan 21 — The International Monetary Fund today cut its world economic growth forecasts for 2019 and 2020 due to weakness in Europe and some emerging markets, and said failure to resolve trade tensions could further destabilise a slowing…


China’s 2018 economic growth slowest in nearly 30 years

BEIJING: China’s economy grew at its slowest pace in almost three decades in 2018, losing more steam in the last quarter as it battles a massive debt pile and a US trade war, official data showed today.

The 6.6% growth comes in above the official target of around 6.5% and matches a forecast by analysts polled by AFP, but is down from the 6.8% chalked up in 2017, according to the National Bureau of Statistics (NBS).

And in a sign of the struggle Beijing faces, growth in the last three months of the year clocked in at 6.4%, matching a low seen during the global financial crisis 10 years ago, with economists widely expecting the slowdown to deepen.

“Everyone is widely concerned about the direction of the international situation where there are many variables and uncertain factors,” said NBS commissioner Ning Jizhe, noting trade protectionism was in vogue.

“For the world’s second-largest economy, where trade accounts for one-third of GDP (gross domestic product), this has an impact,” he said, adding “downward pressure” on the economy has increased.

The slowing growth prompted Premier Li Keqiang last week to vow the government would not let the economy “fall off a cliff”.

Relations with top trading partner the US deteriorated sharply last year after President Donald Trump hit roughly half of Chinese imports with new tariffs in an attempt to force trade concessions.

Escalating the trade war is on hold for now after President Xi Jinping and Trump agreed to a three-month ceasefire, with top negotiators set to meet in Washington at the end of this month as a March deadline for a deal looms large.

“China-US economic and trade frictions do indeed affect the economy, but the impact is generally controllable,” said Ning.

While analysts say the standoff has dented confidence – leaving the stock markets battered and the yuan weakened – they attribute most of the downturn to the government policies to tackle growing debt, financial risk and pollution.

China hit the brakes on major projects such as subway lines and motorways to keep a lid on debt last year, with infrastructure investment rising by just 3.8%, down from 19% the year before.

China’s exports to US and the world also fell in December, reinforcing the need for its legions of domestic consumers to fuel the economy.

Fourth quarter GDP growth slowed as expected, said Lu Ting, China economist at Nomura, in a note. “But the worst is yet to come,” he said.

Li last week touted China’s “massive market” and vowed to spur on consumption, but the data shows difficulty ahead.

Overall credit growth decelerated every month last year.

“The slowdown in credit growth is causing economic momentum to falter,” said Mark Williams, chief Asia economist at Capital Economics, in a note last week.

Slowing disposable income growth and tighter credit has hit consumer spending with car sales falling last year for the first time in more than 20 years.

Retail sales growth slowed to 9.0%, down from a 10.2% increase the previous year. In December, sales grew 8.2%.

Output at factories and workshops ticked up 6.2% for the year, down from 6.6% in 2017.

Chinese officials say they will not resort to large-scale stimulus like during the financial crisis to jolt growth, instead laying out policies like lower taxes and fees and less red tape to drive consumption.

“Growth will remain under pressure in the coming months and policymakers will aim to halt the slowdown in growth, rather than try to engineer a significant pick-up in growth,” said Louis Kuijs of Oxford Economics.

The official figures could be painting an overly rosy picture, analysts say.

Economists in China and abroad have long suspected data is massaged upward, often noting that full-year gross domestic product hits Beijing’s pre-set targets with suspicious regularity.

“China’s GDP number is not an accurate gauge of economic growth,” said Raymond Yeung, economist at ANZ bank.

The governor of northeastern Liaoning admitted in 2017 that the industrial province had falsified data for years.

Even Li said in 2007, when he was Liaoning’s top political official, that results were often “man-made” and he used his own calculations to guide provincial policymaking, according to a confidential memo released by WikiLeaks.

“The NBS is part of the government… that is why it is legitimate for the outside world to worry about potential adjustment of data on the economy,” said Kuijs.

The US-based Conference Board, a widely respected global business think tank, said its methodology indicates growth of 4.1% for 2018.


Nippon Life president says actively exploring M&A in US, Asia

TOKYO, Jan 21 — Nippon Life Insurance Co is actively seeking mergers and acquisitions overseas, with a focus on the United States and Asia’s emerging economies, the president of Japan’s largest life insurer said today. Japanese insurers have…


From Mao to Trump: China’s economic roller-coaster since 1949

SHANGHAI, Jan 21 — After remarkable growth and change for decades, most economists believe China’s economy is entering a period of slower, steadier growth. The world’s second-largest economy grew 6.6 per cent last year, government figures…


Dollar steady near two-week high on recovery in risk appetite

TOKYO, Jan 21 — The dollar hovered near a two-week high against a basket of currencies today, supported by a sustained recovery in investor risk appetite which nudged US bond yields higher. The dollar index, which measures its strength against a…


Asia holds breath for China data, Brexit news

SYDNEY, Jan 21 — Asian markets were in limbo early today ahead of data likely to show the Chinese economy slowed at the end of last year, underlining the urgent need for more stimulus as Beijing wrestles with the United States over trade….